Mahindra Satyam extends ADR cancellation deadline

It is curtains for Mahindra Satyam's ADRs (American Depository Receipts) when trade closes on March 12.

The over-the-counter trade of fraud-hit firm's ADS will cease to exist.

Though Citi, the ADR depository, has extended the deadline for cancellation of ADRs to March 16 from March 12, FINRA (Financial Industry Regulatory Authority of the US) has indicated that the Satyam ADR symbol will be removed from applicable symbols list on March 12.

Satyam's ADRs (SAYCY) is trading at $2.49 in the OTC share market.

Citi has recently written a letter to Mahindra Satyam's ADR holders informing them about the extension of deadline.

“It may take up to 3-4 weeks for a non-resident Indian to open a DR type (demat) account in India.

“If you have not completed the process, it is very unlikely that you will complete the process before March 16 when the deadline ends,” it said.

OTC option

Citi asked the shareholders to dispose their shares in the OTC market before the deadline in case they do not want the depository to sell the underlying shares in India. Such shares sold in India would attract a Withholding Tax of over 42 per cent plus a fee of $0.05 an ADS for the depository and any costs incurred by it.

Unable to comply with US regulatory norms, Mahindra Satyam announced termination of its ADRs in August last. The termination process will be completed in the next two weeks.

Scrip up

Meanwhile, Mahindra Satyam's scrip went up by 3.7 per cent on the BSE, responding to acquisition of v Customer' international operations. The scrip, which opened at Rs 65.65, went up to Rs 68.10 on Friday.

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